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Pregis Announces Third Quarter 2008 Financial Results
Date:11/13/2008

reduction initiatives. The Company expects to incur additional restructuring charges of approximately $3.3 million over the remainder of 2008 and through the first half of 2009 to complete implementation of these initiatives. Combined with the overhead optimization efforts started at the end of 2007, these programs are currently expected to generate annual savings in excess of $25 million.

Segment Performance

Comments on segment net sales performance for the third quarter of 2008 are as follows:

-- Net sales of the protective packaging segment increased by $13.9 million, or 8.8%. The 2008 third quarter sales growth was driven by favorable foreign currency translation, as well as the incremental sales generated by the Besin entity acquired in the fourth quarter of 2007. The segment also achieved pricing improvement in its U.S. and European operations, which more than offset the volume declines attributed to the weakened economic conditions in these markets. Excluding the impacts of favorable foreign currency effects and revenue growth from acquisitions, net sales for the segment increased 2.6%.

-- Net sales of the flexible packaging segment increased $4.2 million, or 9.4%. The increase was driven by favorable foreign currency translation and favorable pricing, partially offset by lower volumes due mainly to weaker economic conditions in Germany, the segment's principal market. Excluding the impact of favorable foreign currency, the segment's 2008 third quarter net sales were relatively flat compared to the prior year period.

-- Net sales of the hospital supplies segment increased $2.0 million, or 10.5%, driven by growth in procedure packs as well as the segment's geographic expansion efforts, partially offset by price erosion resulting from the competitive market environment. Excluding the impact of favorable foreign currency, the segment's 2008 third quarter net sales were relatively flat compared to the prior year period.

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SOURCE Pregis Corporation
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